♦,v* 


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The  Tax  Question 

* 

By  Enoch  Ensley 

(Abridged) 


Introduction  by 

Lawson  Purdy 

Secretary,  New  York  Tax  Reform  Association 


Printed  for  the 

New  York  Tax  Reform  Association 
hi  Broadway,  New  York 
By  The  Trow  Print 
1901 


ELy\  r\8>^’ 

V  CC/A 


CONTENTS 


O 


4 

4~ 


P 

a 

ip 

Page 


Introductory . 7 

The  Tax  Question . 11 

Fallacy  in  the  Constitution . 12 


The  Golden  Rule  of  Taxation  .  .  .14 

Movable  and  Immovable  Property  .  .15 

Reflected  Value  .  .  . . 17 

Effect  of  Taxation  on  Local  Prosperity  18 
Business  Profits  and  Real  Estate  Values  20 
Movable  Property  Attracted  or  Repelled 
by  the  Rate  of  Taxation  .  .  .  .22 

Money,  Merchandise  and  Manufacturing 


Capital . 24 

Reciprocal  Advantages  for  County  and 

City . 25 

Farmers  Gain  from  Prosperous  Cities  .  28 

Local  Option  for  County  and  City  Tax¬ 
ation  . 31 

Improper  Taxation  Worse  than  a  Plague  32 

5 


Page 


Tenants  Must  Prosper  Before  Real  Es¬ 
tate  Owners  Can  Prosper  ...  36 

Real  Estate  Owners  Should  Ask  for 
the  Exemption  of  Personal  Property 

from  Taxation . 37 

Justice  Will  Be  Done . 40 


6 


INTRODUCTORY 


By  LAWSON  PURDY, 

Secretary  New  York  Tax  Reform  Association. 

The  following  letter  was  written  in 
1871  by  Enoch  Ensley,  a  landowner  of 
Tennessee,  to  Governor  Brown.  Mr. 
Ensley  was  a  pioneer  in  the  cause  of 
tax  reform,  and  his  letter,  written  nearly 
thirty  years  ago,  is  just  as  true  and  ap¬ 
plicable  to  present  day  conditions  as 
it  was  to  the  conditions  of  Tennessee 
when  he  wrote  it.  So  far  as  known, 
Mr.  Ensley ’s  thought  was  original  with 
himself,  for  with  the  exception  of  some 
few  advanced  thinkers  in  the  state  of 
New  York,  no  one  had  advocated  in 
this  country  the  exemption  of  personal 
property  from  taxation. 

The  general  property  tax  had  natu¬ 
rally  grown  up  in  this  country  as  an  in¬ 
heritance  from  Europe,  and  in  the  early 
days  of  the  republic,  when  conditions 

7 


were  primitive,  it  was  comparatively 
easy  to  tax  all  forms  of  property.  The 
original  theory  on  which  the  general 
property  tax  was  based  seems  to  have 
been  that  men  should  pay  taxes  in  pro¬ 
portion  to  their  ability,  and  that  the 
amount  of  their  property  was  a  fair  in¬ 
dex  of  their  ability  to  pay.  At  the 
present  day  it  is  not  uncommon  to  find 
the  theory  advanced  that  equality  of 
taxation  requires  the  equal  taxation  of 
all  property. 

Both  these  theories  are  condemned 
by  their  impracticability,  but  the  theo¬ 
ries  themselves  will  not  stand  exam¬ 
ination.  There  is  no  reason  why  dif¬ 
ferent  principles  should  be  advanced  to 
justify  payments  to  the  state  from  those 
which  justify  payments  in  business  deal¬ 
ings  between  man  and  man.  All  ordi¬ 
nary  business  dealings  are  based  on 
the  exchange  of  equivalents.  The  store¬ 
keeper  does  not  grade  his  prices  ac- 

8 


cording  to  the  income  of  the  purchaser, 
but  exacts  a  payment  in  proportion  to 
the  value  of  the  article  sold.  This  is 
the  natural  principle  to  be  applied  in 
the  affairs  of  state,  and  each  taxpayer 
should  be  called  on  for  the  equivalent 
of  the  pecuniary  benefits  he  receives 
from  the  state — no  more,  no  less. 

Mr.  Ensley  approaches  the  subject 
from  what  may  be  called  the  practical 
rather  than  the  theoretical  stand-point, 
and  shows  the  unwisdom  and  disad¬ 
vantage  to  the  interests  of  all  in  at¬ 
tempting  to  tax  movable  property.  The 
text  which  he  says  should  be  engraved 
in  letters  of  gold  in  every  legislative 
hall  remains  and  will  remain  supremely 
true: 

Never  Tax  Anything 
That  Would  Be  of  Value  to  Your  State , 

That  Could  and  Would  Run  Away ,  or 
That  Could  and  Would  Come  to  You . 


9 


THE  TAX  QUESTION. 

By  ENOCH  ENSLEY. 

Memphis,  Tenn., 
Sept,  i,  1871. 

To  His  Excellency,  Governor  John 
C.  Brown. 

Dear  Sir  : — As  a  citizen  of  the  state 
over  which  you  have  the  honor  to  pre¬ 
side  as  governor,  feeling  a  deep  interest 
in  its  prosperity,  I  desire  to  submit  for 
your  consideration  and  the  considera¬ 
tion  of  the  people  of  Tennessee,  some 
remarks  on  the  subject  of  taxation — 
what  I  deem  the  correct  principle  or 
system  of  taxation,  as  compared  with 
the  unwise  and  incorrect  system  now  in 
operation  in  our  state ;  and  in  doing  this 
I  desire  to  cast  no  reflections  upon  you, 
as  governor  of  the  state,  nor  hold  you 
in  any  way  responsible  for  the  present 
system — for  the  evil,  as  I  understand 
it,  is  in  our  organic  law,  the  constitu- 


tion  of  the  state,  and  cannot  be  reme*- 
died  short  of  a  change  of  said  consti¬ 
tution.*  Further,  I  will  say  that  if  you 
were,  to  some  extent,  responsible,  I 
would  be  prepared  to  excuse  you,  for 
the  evil  exists  not  only  in  Tennessee, 
but  in  many,  if  not  all,  the  states  of  the 
Union.  But,  notwithstanding  it  may 
exist  in  all  the  states,  it  is,  nevertheless, 
an  evil  —  a  wrong  system  working 
against  the  interests  and  prosperity  of 
the  states  wherein  it  exists ,  but  perhaps, 
owing  to  the  peculiar  surroundings,  not 
so  much  against  the  prosperity  of  any 
state  as  our  state  of  Tennessee. 

FALLACY  IN  THE  CONSTITUTION. 

The  clause  of  our  constitution  I  refer 
to  is  the  one  which  requires  all  property, 
real,  personal  and  mixed,  to  be  taxed 
alike.  Under  this  clause  all  money, 

*  This  does  not  apply  to  the  Constitution  of  the  State  of 
New  York. 


12 


trade,  etc.,  are  sought  to  be  taxed.  It 
requires  not  only  that  the  state  tax 
should  be  levied  on  it,  but  also  that  the 
county  and  city  tax  in  the  various  coun¬ 
ties  and  cities  of  the  state,  for  their  re¬ 
spective  uses,  should  be  levied  on  it, 
and  said  various  counties  and  cities 
cannot  exempt  from  taxation,  even  if 
they  should  be  disposed,  when  the  tax 
is  entirely  for  their  own  purposes,  for 
they  are  left  no  discretion  in  the  matter. 

I  propose  to  show  that,  whilst  every 
part  of  the  state  and  each  and  every 
citizen  of  the  state,  no  matter  what  his 
vocation,  occupation  or  trade  may  be, 
would  be  benefited  by  a  change  of  the 
entire  system,  including  state  as  well  as 
county  or  city,  some  parts  of  the  state 
absolutely  demand  a  change,  so  far  as 
the  county  and  city  tax  is  concerned ; 
and  to  bring  about  a  speedy  change,  as 
you  are  the  only  person  clothed  with 
the  necessary  power  to  take  the  initia- 


tory  steps,  I  take  this  liberty  of  address¬ 
ing  you  upon  the  subject,  hoping  that 
good  may  come  of  it. 

In  showing  or  proving  what  I  have 
above  promised  to  show,  I  will  proceed 
thus : 

THE  GOLDEN  RULE  OF  TAXATION. 

First,  I  will  present  you  with  a  rule  or 
motto  which  I  think  it  would  be  well 
for  the  state  to  adopt  and  have  cut  into 
the  stone  at  the  capitol  (in  large  letters 
and  have  them  gilded),  in  the  senate 
chamber,  the  hall  of  the  house  of  repre¬ 
sentatives  and  in  the  governor’s  office, 
for  I  think  it  entirely  harmonizes  with 
the  correct  principles  of  taxation  in 
every  particular,  to  wit : 

Never  Tax  Anything 
That  Would  Be  of  Value  to  Your  State , 

That  Could  and  Would  Run  Away ,  or 
That  Could  and  Would  Come  to  You . 


14 


MOVABLE  AND  IMMOVABLE  PROPERTY. 

There  are  two  kinds  of  natures  of 
property  in  the  world  only,  movable 
and  immovable ;  the  former,  as  its  name 
implies,  can  be  moved  from  one  place 
to  another,  as  its  owner  chooses ;  the 
latter  is  fixed  and  cannot  budge  an 
inch,  no  matter  what  its  owner  chooses. 
I  hold  it  to  be  true  that  immovable 
property  has  no  value  till  it  is  occupied 
or  located  upon,  or  brought  to  subsist 
or  employ  movable  property,  and  as  a 
rule,  the  more  it  employs  or  subsists, 
the  more  valuable  it  becomes,  and  the 
greater  the  inducements  or  attractions 
it  offers  movable  property,  the  more  it 
will  have  to  locate  upon  it. 

For  instance,  the  best  acre  of  land  in 
America  is  worth  nothing  until  man 
goes  upon  it  with  his  ax,  horse,  cow, 
etc.,  and  cuts  the  timber  off,  builds  his 
log  cabin,  puts  it  in  cultivation  and 
brings  it  to  subsist  himself,  horse,  cow, 
15 


etc.,  and  from  that  moment  it  com¬ 
mences  to  have  a  value,  by  reason  of 
the  fact  that  it  employs  or  subsists  the 
man  (who,  if  he  can  be  called  property 
at  all,  is  certainly  movable  property), 
horse,  cow,  etc.  (the  horse,  cow,  etc.,  are 
movable  property).  And  if  this  acre  of 
ground,  from  any  cause,  should  become 
attractive  to  and  employ  double  the 
amount  of  movable  property,  as  a  gen¬ 
eral  rule  it  will  become  doubly  valua¬ 
ble  and  so  on ;  if  it  should  become  at¬ 
tractive  to  and  employ  profitably  ten  or 
a  hundred  or  a  thousand  fold  more 
movable  property,  it  would  become,  in 
like  ratio,  more  valuable,  even  up  to 
the  value  of  Mr.  A.  T.  Stewart’s  acre  of 
ground  on  Broadway,  New  York,  which 
is  worth  perhaps  two  million  dollars,  by 
reason  of  the  fact  that  it  offers  attrac¬ 
tions  and  has  employed  upon  it  profit¬ 
ably  five,  ten  or  fifteen  million  dollars’ 
worth  of  movable  property.  (Of  course, 


when  ground  gets  beyond  a  certain 
value  it  must  be  put  to  other  uses  than 
agriculture.)  Just  this  process  the  Stew¬ 
art  acre  of  ground  has  doubtless  passed 
through  since  the  Dutch  first  landed  on 
Manhattan  Island. 

REFLECTED  VALUE. 

There  are  exceptions  to  this  rule — 
that  immovable  property  is  valuable  as 
it  has  movable  property  employed  di¬ 
rectly  on  it,  for  it  frequently  has  a 
greater  value  than  the  movable  prop¬ 
erty  employed  directly  on  it  would  war¬ 
rant.  It  has  a  value  reflected  from  the 
employment  of  movable  property  on 
immovable  property  near  by,  as  in  the 
ease  of  residences  in  or  near  cities..  For 
instance,  the  use  of  Mr.  Stewart’s  mov¬ 
able  property  on  his  Broadway  lot  not 
only  gives  great  value  to  that,  but 
also  gives  a  value  to  his  residence  up 
town,  by  reason  of  the  fact  that  it  is  suf- 

17 


ficiently  near  and  convenient  for  it  to 
be  in  demand  for  him  to  live  there  and 
transact  his  business  daily  at  his  store, 
all  of  which,  however,  is  attributable  to 
the  employment  of  movable  property 
on  his  Broadway  acre. 

EFFECT  OF  TAXATION  ON  LOCAL 
PROSPERITY. 

The  thrift  or  profit  which  immovable 
property  offers  to  movable  property 
helps  to  regulate  its  value.  For  in¬ 
stance,  a  man  owns  two  pieces  of  prop¬ 
erty  alike  —  say  in  different  towns  — 
rented  out  to  merchants  of  equal  capi¬ 
tal  ;  one  is  enabled  to  make  7  per  cent 
per  annum  only  on  his  capital,  for  the 
reason  that  he  has  to  pay  3  per  cent 
tax  on  his  capital,  and  the  other  makes 
10  per  cent  net,  and  pays  no  tax;  the 
property  paying  10  per  cent  will  be  the 
most  valuable,  for  it  will  pay  the  largest 
rent,  because  there  will  be  more  appli- 

18 


cants  for  it  than  for  the  7  per  cent,  and, 
the  law  of  supply  and  demand  govern¬ 
ing,  it  must  rent  for  more.  It  is,  how¬ 
ever,  impossible  as  a  general  thing  for 
these  two  merchants  to  remain  of  equal 
capital.  The  10  per  cent  man  will  soon 
have  more  capital  from  his  extra  thrift, 
and  the  7  per  cent  man,  seeing  his  pros¬ 
perity,  is  apt  to  pull  up  stakes  and  quit 
his  town  and  move  to  the  10  per  cent 
town,  and  other  merchants  will  perhaps 
do  the  same  thing,  until,  by  competition 
increasing  in  the  one  town  by  other 
merchants  coming  in,  and  decreasing  in 
the  other  by  their  going  out,  may  make 
profits  the  same.  This,  however,  is  not 
apt  to  make  profits  the  same  in  a  coun¬ 
try  like  ours,  for  there  is  generally  new 
trade  to  be  looked  up  to  keep  pace  with 
the  new  comers.  So  the  result  would 
be  that  new  comers  would  continue  to 
go  to  the  10  per  cent  town  from  the  7 
per  cent  town  and  other  places,  until 
19 


the  one  becomes  a  large  and  prosperous 
city  and  the  other  a  dilapidated,  lan¬ 
guishing  town.  It  will  be  easy  then  to 
say  which  storehouse  is  the  most  valu¬ 
able. 

BUSINESS  PROFITS  AND  REAL  ESTATE 
VALUES. 

I  hold  that  of  all  men  the  real  estate 
or  fixed  property  man  is  the  most  inter¬ 
ested  in  the  rule  or  motto  I  have  adopt¬ 
ed.  To  illustrate  nearer  home,  I  will 
say  that  there  is  an  acre  of  ground  in 
Memphis,  Tenn.,  say,  in  front  of  the 
Peabody  Hotel,  Overton  block,  that  is 
worth  at  the  rate  of  $ 200,000  per  acre, 
whilst  the  writer  has  an  acre  six  miles 
below  the  city,  quite  as  good  naturally, 
and  even  better,  than  the  Overton  block 
acre,  because  it  will  produce  more  corn, 
cotton,  pumpkins,  peas,  potatoes,  cab¬ 
bage,  etc.,  than  the  Overton  acre  will, 
or  ever  would,  and  my  acre  is  not  worth 


20 


one  hundred  dollars  per  acre.  Now, 
why  is  it  that  the  Overton  acre  is  worth 
$200,000  per  acre  and  mine  not  worth 
$100}  The  reason  is  that  there  is  em¬ 
ployed  on  the  Overton  acre,  profitably, 
two,  three,  four  or  five  hundred  thou¬ 
sand  dollars  of  movable  property,  while 
upon  mine  there  is  employed  the  six¬ 
teenth  part  of  a  negro,  the  sixteenth  part 
of  a  mule,  plow,  hoe,  etc.  Now,  if  you 
will  manage  in  any  way,  either  by  taxa¬ 
tion  or  otherwise,  to  drive  from  this 
Overton  acre  the  two,  three,  four  or  five 
hundred  thousand  dollars,  and  render 
the  Overton  acre  so  that  this  capital,  or 
any  part  of  it,  cannot  be  employed  on 
it  with  a  profit,  it  will  not  be  worth 
more  than  my  acre — in  fact,  not  so 
much — for  there  is  nothing  so  valueless 
as  ground  covered  with  houses  when 
there  is  no  demand  for  said  houses. 
And,  further,  if  you  do  anything  to 
make  the  two,  three,  four  or  five  hun- 


21 


dred  thousand  dollars  pay  less  profit 
you  will  damage  the  ground  or  lessen 
its  value  more  rapidly  than  you  will 
decrease  the  profits — not  in  the  same 
ratio,  but  more  rapidly.  Suppose,  for 
instance,  the  profit  has  been  io  per  cent 
net  on  the  capital  employed,  and  the 
property  is  paying  a  rental  on  $300,- 
000;  if  you  reduce  the  profits  perma¬ 
nently,  in  any  way,  to  5  per  cent  net,  the 
property  would  not  pay  a  rental  on 
$150,000 — in  fact,  it  would  hardly  pay 
any  rent  at  all,  for  5  per  cent  would  be 
too  small  to  induce  a  business  at  all  in 
this  country. 

MOVABLE  PROPERTY  ATTRACTED  OR 
REPELLED  BY  THE  RATE  OF  TAXA¬ 
TION. 

Movable  property  always  seeks  and 
locates  on  immovable  property  where 
it  thrives  and  multiplies  most  rapidly. 

It  is  said  that  it  was  the  last  feather 


22 


that  broke  the  camel’s  back,  whilst  the 
first  had  as  much  to  do  with  it  as  the 
last.  An  oppressive  tax,  such  as  exists 
in  some  parts  of  our  state,  drives  off  a 
good  deal  of  movable  property  and  ab¬ 
solutely  forbids  any  more  coming  to 
such  parts,  unless  it  comes  relying  upon 
dodging  or  evading  the  law,  which  large 
capital  never  does.  Men  of  small 
amounts  of  money,  goods,  etc.,  such  as 
one  can  hide,  may  come,  but  men  of 
large  amounts  of  money,  to  go  into 
open  banking  or  merchandizing,  on  a 
scale  that  cannot  be  hidden,  or  evade 
the  law,  will  not  come. 

Of  course,  all  mankind,  where  they 
have  lived  for  a  time,  form  local  and 
social  ties  and  will  submit  to  some  op¬ 
pression,  though  their  property  be  all 
movable,  before  they  get  their  consent 
to  move  away,  but  with  the  millions  of 
dollars  of  movable  property  we  desire 
to  attract  to  us,  no  such  ties  exist,  and, 


23 


if  we  do  not  offer  quite  as  much  thrift 
as  other  localities,  and  even  more,  when 
the  property  may  be  already  located, 
we  need  not  expect  to  attract  it  to  us. 

MONEY,  MERCHANDISE  AND  MANUFACT¬ 
URING  CAPITAL. 

As  I  have  said,  any  tax  levied  upon 
movable  property  tends  to  drive  it 
away;  consequently  it  is  incorrect  in 
principle,  whilst  a  heavy  and  oppres¬ 
sive  tax  is  absolutely  prohibitive  and 
suicidal.  Embraced  in  the  rule  I  have 
presented  in  the  beginning,  never  to  tax 
anything  that  would  be  of  value  to  your 
state,  that  could  and  would  run  away, 
or  that  could  and  would  come  to  you, 
are  two  or  three  kinds  of  movable 
property  which  I  regard  as  most  impor¬ 
tant,  and  which  I  will  mention,  to  wit : 
Money ,  merchandise  and  capital  to  be 
used  in  manufacturing.  These  pertain 
to  cities  mostly.  There  are  many  other 

24 


kinds  of  property  which,  perhaps,  would 
come  under  the  rule,  but  for  the  present 
I  will  speak  of  these  three,  because 
through  them  great  wealth  generally 
enters  the  state. 

RECIPROCAL  ADVANTAGES  FOR 
COUNTY  AND  CITY. 

And  here  I  desire  to  call  your  atten¬ 
tion  to  the  fact  that  the  great  bulk  of 
the  movable  property  generally  enters 
a  state  or  nation  through  its  cities  and 
towns,  money  and  merchandise  or  trade 
always,  and  capital  for  manufacturing 
purposes  most  frequently,  and  from  the 
cities  and  towns  its  beneficial  effect  is 
radiated  throughout  the  state  far  and 
near,  greater  the  nearer  the  city,  but 
beneficial  to  some  extent  even  to  the 
utmost  bounds  of  the  state,  particularly 
when  we  owe  a  common  debt,  as  most 
of  the  states  of  the  American  Union  do, 
and  as  our  state  of  Tennessee  certainly 
25 


does,  to  the  extent  of  over  $ 20,000,000 . 
And  here  I  wish  to  note  the  fact  that 
there  exists  in  Tennessee,  in  the  minds 
of  some  of  our  farmers,  or  people  living 
in  the  country,  a  prejudice  against  the 
cities.  They  imagine  that  the  interest 
or  prosperity  of  the  cities  is  entirely 
separate  from  theirs,  if  not  antagonistic, 
and  again,  the  people  of  one  part  of  our 
state  imagine  their  interest  to  be  sepa¬ 
rate  from  other  parts  of  the  state,  which 
is  incorrect  in  toto.  This  idea  or  feel¬ 
ing  has  to  a  great  extent  been  manufact¬ 
ured  by  demagogues  or  ignorant  poli¬ 
ticians  and  by  newspapers  actuated  by 
incorrect  motives  or  ignorance  of  the 
correct  relations  between  cities  and 
country  and  the  different  parts  of  the 
state.  This  is  all  wrong,  and  the  sooner 
the  people  turn  a  deaf  ear  to  all  such 
the  better  it  will  be  for  all  parties. 
There  is  no  antagonism  of  interest  be¬ 
tween  them,  but,  on  the  contrary,  a 


unity  of  interest.  For  a  city  to  grow 
large,  rich  and  prosperous  within  the 
borders  of  a  state  that  owes  a  debt  to 
be  paid  by  all  parts  of  the  state  in  pro¬ 
portion  to  the  wealth  of  the  respective 
parts,  of  course,  cannot  be  against  the 
interest  of  any  part  of  the  state  or  coun¬ 
try,  and  vice  versa,  for  the  country  to 
become  rich  and  prosperous  it  cannot 
well  hurt  the  cities,  for  east  Tennessee 
to  flourish  cannot  hurt  middle  and  west 
Tennessee,  and  so  on.  But,  on  the 
contrary,  the  prosperity  of  one  is  and 
must  be  advantageous  to  the  other,  not 
only  so  far  as  paying  the  common  debt 
is  concerned,  but  in  divers  other  ways, 
such  as  the  country  patronizing  the 
trade  and  manufactories  of  the  cities, 
etc.,  and  the  cities,  in  return,  buying 
what  they  may  consume  of  country 
products  from  the  country  and  offering 
a  near  and  convenient  market  for  many 
of  their  products  that  cannot  be  shipped 


to  more  distant  markets,  besides  shed¬ 
ding  or  radiating  an  increased  value  on 
their  lands  in  every  direction,  for  miles 
and  miles.  To  attempt  to  enumerate 
the  various  reciprocal  advantages  is 
useless,  for,  the  mind  once  directed  to 
the  subject,  they  become  apparent  by 
the  scores. 

FARMERS  GAIN  FROM  PROSPEROUS 
CITIES. 

And  here  I  desire  to  call  the  attention 
of  the  farmer  or  countryman  to  a  fact 
that  many  have  never  thought  of,  which 
may  tend  to  abate  their  hostility  toward 
the  cities.  It  is  this,  to  wit :  Whilst  it 
is  impossible  for  a  rich  and  prosperous 
farming  country  to  surround  a  city 
without  contributing  to  the  prosperity 
of  said  city,  yet  it  is  possible  for  a  city  to 
be  located  within  the  borders  of  a  state 
and  grow  to  be  rich,  prosperous  and 
large  and  to  add  great  value  to  the 


lands  around  and  to  the  state  without 
receiving  a  corresponding  value  from 
the  country  of  said  state.  In  fact,  such 
is  always  the  case  where  the  city  is 
large  ;  for  instance,  the  great  city  of  New 
York  is  not  indebted  to  the  country  or 
farm  lands  of  New  York  for  one-hun¬ 
dredth  of  her  prosperity  and  wealth. 
She  reaps  her  wealth  not  only  from  all 
the  states  of  the  Union,  but  from  all  the 
civilized  parts  of  the  world,  yet  she 
doesn’t  contribute  a  dollar  to  the  pay¬ 
ment  of  current  expenses  and  state  debt 
of  any  state  in  the  Union  or  any  part  of 
the  world  except  the  state  of  New  York. 
She  gives  in  her  immense  wealth  to  be 
taxed  solely  for  the  state  of  New  York, 
thereby  relieving  each  and  every  farmer 
in  the  state.  St.  Louis  reaps  a  majority 
of  her  prosperity  from  other  states  than 
Missouri.  New  Orleans  reaps  four-fifths 
of  her  prosperity  from  other  states  than 
Louisiana.  Hence  it  will  be  seen  that 


29 


the  farmers  or  country  people  should 
not  be  prejudiced  against  the  cities  lo¬ 
cated  within  their  state,  for  they  re¬ 
ceive  more  aid  from  them  than  they 
give  in  return,  and  are  consequently 
the  gainers.  So  the  practical  operation 
of  large  cities  seems  to  be  to  receive 
trade,  and  become  rich  out  of  it,  from 
other  states  more  than  their  own,  and 
allow  their  own  state  alone  to  receive 
the  full  benefit,  as  far  as  her  demands 
go.  This,  it  strikes  me,  should  not  be 
objectionable  to  the  farmer  or  country¬ 
man,  or  to  the  state  or  any  part  of  the 
state.  Consequently,  by  no  means 
should  they  desire  any  law  of  any  kind 
to  exist  in  the  land  .whereby  the  cities 
are  oppressed  and  kept  from  growing, 
when  by  its  repeal  or  modification  they 
would  not  be  harmed  a  particle,  but, 
on  the  contrary,  be  benefited,  as  is 
now  the  case  in  some  parts  of  Ten¬ 
nessee,  and  as  I  expect  to  show  be- 

30 


fore  I  close  this  communication  be¬ 
yond  controversy. 

LOCAL  OPTION  FOR  COUNTY  AND  CITY 
TAXATION. 

Thus  far  it  has  been  my  object  to 
show  that  it  is  unwise  and  in  violation 
of  the  correct  principle  of  taxation  and 
against  the  interest  of  the  state  and 
every  part  of  the  state  and  against  the 
interest  of  every  individual  in  the  state 
and  every  occupation  in  the  state,  and 
especially  against  the  interest  of  the 
real  estate  or  immovable  property 
owner  of  the  state,  to  tax  or  in  the 
least  oppress  movable  property,  and 
whilst  I  have  no  doubt  of  the  correct¬ 
ness  of  the  principle  or  policy,  as  I  have 
before  said,  I  do  not  hope  to  get  the 
state,  as  far  as  the  tax  of  forty  cents  on 
the  hundred  dollars  is  concerned,  to 
make  any  change,  but  I  do  hope  to  get 
our  laws  changed,  so  far  as  our  counties 
31 


and  cities  are  concerned,  so  that  they 
may  be  allowed,  at  their  option,  to  levy 
their  county  and  city  tax  for  their  county 
and  city  purposes,  on  whatever  species 
of  property  they  may  see  proper,  thus 
giving  some  of  them  that  are  literally 
blighted  and  crushed  the  privilege  of 
throwing  off  the  great  bulk  of  their 
oppression. 

IMPROPER  TAXATION  WORSE  THAN  A 
PLAGUE. 

Further  I  will  say,  if  you  will  levy 
and  enforce  and  collect  the  tax  that  is 
sought  to  be  collected  in  Memphis  to¬ 
day  on  the  money,  trade,  etc.,  of  the 
great  city  of  New  York,  and  you  charge 
no  tax  in  Boston,  Philadelphia  or  Balti¬ 
more,  I  will  guarantee  to  transfer  in  a 
short  time  hundreds  of  millions  of  the 
trade,  money,  etc.,  of  New  York  to 
those  cities,  and  it  she  will  continue  it 
five  or  ten  years  I  will  guarantee  to 

32 


show  you,  in  either  of  these  cities,  more 
trade,  more  money  and  more  people 
than  in  New  York.  I  will  guarantee 
to  depopulate  her  more  effectually  and 
more  permanently  than  a  plague  ever 
did  a  city,  and  impoverish  her  more 
effectually  than  ever  a  war  did.  Yes,  I 
will  hurt  her  infinitely  worse  than  fire 
that  might  burn  every  house  from 
Castle  Garden,  from  river  to  river,  to 
Central  Park.  I  will  make  it  entirely 
safe  for  women  and  children  to  cross 
Broadway  at  City  Park,  Astor  House, 
Wall  street  or  elsewhere  without  the 
protection  of  policemen.  I  will  reduce 
the  value  of  the  real  estate  of  Mr.  Astor 
from  $100,000,000  (it  is  said  to  be 
worth  $ 100,000,000 )  to  $25,000,000  or 
$10,000,000,  and  perhaps  even  less,  and 
the  estate  of  every  real  estate  or  im¬ 
movable  property  holder  in  the  same 
ratio,  but  I  cannot  say  that  I  will  greatly 
injure  the  movable  property  man,  for 


he  may  go  to  Boston,  Philadelphia  or 
Baltimore  and  do  quite  as  well  as  he 
did  in  New  York  City  with  his  money, 
goods,  etc.  The  truth  is,  it  would  en¬ 
tirely  bankrupt  the  great  city,  for  the 
demand  for  immovable  property  would 
not  be  sufficient  to  pay  a  rental  suffi¬ 
cient  to  pay  the  interest  on  her  city, 
county  and  state  debt. 

Hence  I  say  that  of  all  the  men  of  our 
state  who  should  object  to  oppressive 
and,  to  follow  the  principle,  I  will  say 
any  taxation  at  all  on  money,  mer¬ 
chandise  or  trade,  manufactories,  etc., 
it  is  the  man  who  owns  the  real  estate 
or  immovable  property.  His  position 
should  be  this:  He  should  say  to  the 
thousands  of  men  in  the  civilized  world, 
with  their  money  in  their  pockets,  look¬ 
ing  out  a  favorable  locality  to  go  to 
banking,  merchandising,  manufacturing 
or  farming,  etc.,  “  Come,  locate  on  me ;  I 
will  not  oppress  you  ;  come  to  me,  for  I 

34 


can’t  go  to  you,  and  we  must  come  to¬ 
gether  or  I  am  worth  nothing,  and,  know¬ 
ing  this,  I  will  not  tax  you  and  oppress 
you.  Other  localities  make  you  pay  a 
tax:;  I  will  not;  consequently  I  offer  that 
advantage  over  other  localities.”  Here¬ 
tofore  it  has  been  the  merchant  who  has 
done  the  complaining  about  the  tax 
levied  on  him ;  he  is  not  the  one  to  do 
it;  it  is  the  real  estate  man,  and  the 
writer  being  one  of  those  men  owning 
real  estate  almost  entirely,  say,  nine- 
teen-twentieths  of  what  he  owns  being 
in  farms  and  other  kinds  of  realty  or  im¬ 
movable  property,  and  not  owning  a 
dollar’s  worth  of  merchandise  of  any 
kind  for  sale,  and  not  being  a  lender  of 
money,  but,  on  the  contrary,  a  borrower, 
and  not  being  a  manufacturer  of  any 
kind,  and  not  being  the  owner  of  ma¬ 
chinery  except  a  steam  saw-mill  and  a 
steam  cotton-gin  establishment,  but  be¬ 
ing  what  is  known  as  a  plain  farmer  or 

35 


planter  by  profession  or  occupation, 
thinking  he  sees  his  interest  in  the 
system  he  is  advocating,  consequently 
therein  is  to  be  found  the  moving 
cause  of  this  letter. 

TENANTS  MUST  PROSPER  BEFORE  REAL 
ESTATE  OWNERS  CAN  PROSPER. 

Here  I  wish  to  state  a  truism  which, 
perhaps,  many  owners  of  real  estate  in 
Tennessee  may  never  have  thought  of. 
It  is  this,  to  wit:  The  renter  or  lessee 
of  real  estate  must  always  prosper  be¬ 
fore  the  owner  of  the  real  estate  can  ex¬ 
pect  to  prosper.  This  is  certainly  true 
as  a  rule,  when  taken  for  a  series  of 
years  in  a  country  like  ours  where  land 
is  abundant,  and  the  people  free  to  go 
where  they  please.  This  will  apply  to 
all  real  estate,  whether  farms,  store¬ 
houses,  shops  or  other  kinds  of  realty. 
I  do  not  mean  that  he  must  have  greater 
prosperity,  but  that  he  must  prosper  first. 

36 


REAL  ESTATE  OWNERS  SHOULD  ASK 
FOR  THE  EXEMPTION  OF  PERSONAL 
PROPERTY  FROM  TAXATION. 

I  think  I  have  shown  beyond  ques¬ 
tion  all  that  I  promised  to  show  in  the 
beginning  of  these  remarks — that  it  is 
not  in  harmony  with  the  interests  of 
anyone  in  the  state  to  tax  money,  trade, 
manufactures,  etc.,  and  that,  of  all  others, 
the  owner  of  fixed  or  immovable  prop¬ 
erty  should  demand  that  the  present 
system  be  changed — that  they  should 
say,  don’t  adopt  any  system  that  has  a 
tendency  to  drive  movable  property 
from  me,  but,  on  the  contrary,  adopt  a 
system  that  will  attract  it,  for  we  are 
worth  nothing  without  it  and  the  mov¬ 
able  property  man  may  go  elsewhere 
and  do  quite  as  well. 

Whilst  I  have  shown  that  any  tax 
upon  movable  property  is  incorrect  in 
principle,  yet,  as  I  have  before  twice 
said,  it  is  not  my  hope  to  have  any 

37 


change  made  at  present,  so  far  as  the 
state  tax  is  concerned,  and,  as  I  before 
said,  it  is  to  get  the  laws  changed  so  as 
to  allow  the  counties  and  cities,  so  far 
as  their  county  and  city  taxes  are  con¬ 
cerned,  to  be  allowed  to  levy  the  tax  on 
whatever  species  of  property  they  may 
see  proper.  I  think  I  have  shown  the 
absolute  necessity  for  a  change,  so  far 
as  two  of  our  counties  and  cities  are 
concerned,  and  perhaps  more  of  them, 
and  one  of  them,  Memphis,  that  is  al¬ 
most  a  life  and  death  matter  with  her, 
and  whilst  I  think  I  have  shown  that 
her  surroundings  are  as  good  as  those 
of  any  other  city,  inland,  in  the  United 
States,  yet  it  is  impossible  for  her  to 
grow  and  become  a  large  and  prosper¬ 
ous  city  under  the  present  system  and 
rate  of  taxation.  When  taxes  are  very 
small,  the  correct  system  can  be  vio¬ 
lated  without  perceptible  harm — yet 
harm  will  be  done ;  but  when  they  get 

38 


to  be  high  and  oppressive  a  violation  is 
ruinous. 

To  illustrate:  For  instance,  suppose 
it  was  necessary,  in  Nashville  and 
Memphis,  in  order  to  pay  current  ex¬ 
penses,  interest  on  debts,  etc.,  to  levy  a 
tax  of  i  o  or  15  per  cent,  on  all  kinds  of 
property,  real,  personal  and  mixed,  and 
that  it  was  rigidly  enforced.  Does  any¬ 
one  suppose  that  there  would  be  any 
movable  property  there  in  twelve 
months  to  collect  the  tax  from?  No, 
sir;  you  would  hardly  be  able  to  find  a 
pocket-handkerchief  or  a  pound  of  cof¬ 
fee  in  either  of  these  cities.  But  all  the 
real  estate,  houses,  etc.,  would  be  there 
still,  but  without  tenants,  and  conse¬ 
quently,  on  account  of  the  high  tax  and 
want  of  occupants,  worth  nothing.  Sup¬ 
pose,  again,  it  was  possible  to  adopt  a 
process  to  make  the  real  estate  worth 
something,  could  it  be  done  by  running 
the  occupants  off  and  receiving  no  rent 


39 


whatever  from  it?  No;  it  could  only 
be  done  by  adopting  a  process  which 
would  fill  all  of  your  houses  with  ten¬ 
ants,  and  secure  to  you  a  rental  from 
them,  and  that  could  only  be  done  by 
allowing  movable  property  to  thrive  and 
by  attracting  a  sufficient  amount  of  it  to 
you  to  occupy  additional  ground  and 
to  pay  additional  rental  until  your  rental 
would  be  more  than  the  tax.  This 
process,  at  any  rate,  and  under  all  cir¬ 
cumstances,  would  be  better  than  have 
these  cities  entirely  deserted. 

JUSTICE  WILL  BE  DONE. 

I  have  mentioned  this  subject  in  the 
last  twelve  months  to  many  of  the  first 
minds  of  the  state ;  at  first  they  would 
oppose  me,  and  invariably  they  would 
say  it  is  right  and  just  for  all  kinds  of 
property  to  be  taxed  alike ;  they  all  re¬ 
ceive  protection  from  the  laws  alike,  and 
of  course  they  ought  to  pay  alike.  Jus- 

40 


tice  is  not  violated  by  the  system  I  pro¬ 
pose,  for  there  is  no  oppression.  Injustice 
is  done  to  the  real  estate  owner  under 
the  present  system,  for  it  injures  him. 
I  will  not  injure  anyone,  and  conse¬ 
quently  will  not  violate  justice.  How¬ 
ever,  it  is  due  to  the  system  I  am  advo¬ 
cating  to  say  that  of  the  aforesaid  first 
minds  of  the  state  I  have  met,  that  I 
never,  with  scarcely  an  exception,  failed 
to  convince  them  they  were  wrong,  and 
that  my  position  was  correct. 

To  undertake  to  enforce  a  very  op¬ 
pressive  tax  on  money  is  ridiculous 
nonsense.  It  is  impossible.  The 
Maker  of  all  things  has  forbidden  it,  in 
giving  to  all  things  their  peculiar  nat¬ 
ure.  He  has  forbidden  an  oppressive 
tax  on  money,  by  giving  it  that  easy 
mobility  that  it  can  go  in  a  fortnight 
from  Tennessee  almost  to  the  uttermost 
parts  of  the  world.  And  just  so,  to 
some  extent,  with  other  kinds  of  mov- 


41 


able  property.  It  would  be  about  as 
wise  for  the  Legislature  to  pass  a  law 
enacting  that,  from  and  after  this  date, 
the  great  bulk  of  the  water  of  the  Mis¬ 
sissippi  River  shall  flow  toward  Cairo 
instead  of  toward  New  Orleans,  as  to 
enact  that  the  great  bulk  of  the  money 
of  Memphis  shall  pay  per  cent  tax 
per  annum.  It  is  wise  in  man  to  deal 
with  things  as  they  are,  and  will  be  in 
spite  of  him,  and  not  as  he  may  think 
they  should  be.  Don’t  kick  against  the 
pricks ! 


42 


b 


i 


' 


